Ad Hoc Shrimp Trade Action Committee v. United States, Slip Op. 14–55.

Citation992 F.Supp.2d 1285
Decision Date20 May 2014
Docket NumberCourt Nos. 10–00275,Slip Op. 14–55.,11–00335.
PartiesAD HOC SHRIMP TRADE ACTION COMMITTEE, Plaintiff, v. UNITED STATES, Defendant, and Hilltop International and Ocean Duke Corp., Defendant–Intervenors.
CourtU.S. Court of International Trade

OPINION TEXT STARTS HERE

Andrew W. Kentz, Jordan Charles Kahn, Nathaniel Maandig Rickard and Nathan W. Cunningham, Picard Kentz & Rowe LLP, of Washington, DC, for the Plaintiff.

Joshua E. Kurland, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, for the Defendant. With him on the briefs were Stuart Delery, Assistant Attorney General, Jeanne E. Davidson, Director, and Patricia M. McCarthy, Assistant Director. Of counsel on the briefs was Melissa M. Brewer, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.

Mark E. Pardo and Andrew T. Schutz, Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP, of Washington, DC, for the DefendantIntervenors.

OPINION

POGUE, Chief Judge:

This opinion addresses litigation arising out of the fourth and fifth administrative reviews of an antidumping duty order covering certain warmwater shrimp from the People's Republic of China (“PRC” or “China”). During the subsequent sixth administrative review of this order, Commerce found that respondent Hilltop International (“Hilltop”) had made material misrepresentations regarding its affiliations and corporate structure throughout the entire history of the order.1 At the time of this finding, liquidation of entries covered by the fourth and fifth administrative reviews remained enjoined pending the final outcome of judicial review. 2 Concluding that the evidence of Hilltop's misconduct was equally applicable to the fourth and fifth reviews, Commerce requested and was granted permission to reopen the records of those reviews in order to consider the effect of this new evidence on Hilltop's calculated dumping margins.3 Hilltop now challenges the results of Commerce's redeterminations.4

The court has jurisdiction pursuant to Section 516A(a)(2)(B)(iii) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii) (2006), 5 and 28 U.S.C. § 1581(c) (2006).

As explained below, Commerce's reasonable determination not to rely on Hilltop's representations, and to therefore treat Hilltop as part of the PRC-wide entity in the fourth review, is sustained on the same grounds as those supporting the affirmance of Commerce's essentially identical determination in the (revisited) fifth review.6 In addition, Commerce's corroboration analysis, supporting the use of the 112.81 percent countrywide rate in the revised results of the fourth and fifth reviews, is also sustained.

PROCEDURAL BACKGROUND

Because the results of the fifth review were already being reconsidered pursuant to remand at the time that new evidence of Hilltop's misconduct came to light during the sixth review, Commerce's decision regarding the effect of this new evidence on Hilltop's margin calculations came to court first on the (reopened) record of the fifth review. Reexamining this supplemented record, Commerce determined that Hilltop had misrepresented information regarding the scope of its affiliates and corporate structure, and moreover that the circumstances of these misrepresentations—in particular Hilltop's failure to provide a persuasive explanation for the material errors, as well as its refusal to answer Commerce's follow-up questions regarding potential as-yet undisclosed affiliates—were such that Hilltop's remaining representations regarding corporate ownership and control were not reliable.7 Because Commerce had initially granted Hilltop separate rate status based solely on these no longer reliable representations, it accordingly determined that Hilltop had failed to submit reliable evidence to rebut the presumption of government control attaching to all exporters covered by this antidumping duty order.8 Commerce consequently assigned to Hilltop the 112.81 percent countrywide rate, which was derived from the petition to initiate these proceedings (the “Petition”) and last corroborated during Commerce's initial investigation into unfair pricing (the less than fair value or “LTFV” investigation).9

Commerce's unreliability determination and decision in the fifth review to assign the PRC-wide rate to Hilltop were affirmed on judicial review. 10 However, Commerce's (re-determined) results of the fifth review were remanded for reconsideration of the corroboration analysis Commerce used to satisfy itself that the countrywide rate derived from the Petition had probative value with respect to the likely pricing behavior of the non-cooperating PRC-wide entity.11 Commerce then revisited its corroboration analysis, the results of which are one of the matters now before the court.12

Meanwhile, the (revisited) results of the fourth review—wherein Commerce made essentially identical findings and conclusions with respect to Hilltop, based on identical evidence, as it did in the (revisited) fifth review—are also before the court.13 In its redetermination of Hilltop's antidumping duty assessment rate in the fourth review, Commerce also revisited its corroboration of the countrywide rate, which it assigned to Hilltop also in that revisited review. This corroboration analysis (as well as the countrywide rate itself) is identical to that employed pursuant to remand of the results of the fifth review.14 Hilltop now challenges Commerce's unreliability determination and decision to assign to Hilltop the PRC-wide rate in the fourth review, as well as Commerce's corroboration analysis for the countrywide rate in both the (revisited) fourth and fifth reviews.15

STANDARD OF REVIEW

The court will sustain Commerce's antidumping determinations, including redeterminations made pursuant to remand, so long as such determinations are supported by substantial evidence, are otherwise in accordance with law and, in the case of redeterminations, are consistent with the court's remand order. See19 U.S.C. § 1516a(b)(1)(B)(i); Trust Chem Co. v. United States, ––– CIT ––––, 819 F.Supp.2d 1373, 1378 (2012). Substantial evidence refers to “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion,” SKF USA, Inc. v. United States, 537 F.3d 1373, 1378 (Fed.Cir.2008) (quoting Consol. Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938) (defining “substantial evidence”)), and the substantial evidence standard of review can be roughly translated to mean “is the determination unreasonable?” Nippon Steel Corp. v. United States, 458 F.3d 1345, 1351 (Fed.Cir.2006) (internal quotation and alteration marks and citation omitted). “The specific determination we make is whether the evidence and reasonable inferences from the record support” Commerce's findings. Daewoo Elecs. Co. v. United States, 6 F.3d 1511, 1520 (Fed.Cir.1993) (internal quotation marks and citation omitted).

DISCUSSION
I. Context

In initiating each of these reviews, Commerce reiterated its policy of assigning to all exporters and producers from NME countries—including China—a single countrywide antidumping duty rate unless respondents qualify for “separate rate status” by affirmatively demonstrating freedom from government control over export activities.16 Also in each review, Commerce preliminarily granted Hilltop separate rate status based on Hilltop's representations that it is located in Hong Kong (which is treated as a market economy) and that neither it nor any of its Chinese affiliates are controlled by any government entity.17

Subsequently, however, in the course of the sixth administrative review, Commerce discovered that Hilltop's part owner and general manager (To Kam Keung or “Mr. To”) had incorporated, invested significant funds in, and served on the board of an undisclosed Cambodian affiliate (Ocean King (Cambodia) Company Limited or “Ocean King”). Hilltop had repeatedly certified the contrary to Commerce throughout the prior history of this antidumping duty order. Not only did Hilltop fail to disclose this affiliation in its initial responses to Commerce's inquiries in all segments of this antidumping proceeding, but Hilltop then also explicitly denied the affiliation's existence when questioned specifically about Ocean King on multiple occasions. Only after Commerce obtained and placed on the record public registration documents showing Mr. To to have incorporated and invested large sums in Ocean King did Hilltop concede that, contrary to Mr. To's repeated affirmations denying any knowledge of an affiliation with or investment in Ocean King, Hilltop was in fact affiliated with Ocean King throughout the history of this order.18

Hilltop provided no explanation of its failure to disclose and subsequent repeated denial of its affiliation with Ocean King beyond a vague statement that the error may have been due to Mr. To's lack of personal involvement with Ocean King (despite unequivocal record evidence of his personal involvement and substantial investment during Ocean King's incorporation), “or for whatever reason.” 19 Moreover, beyond admitting that which was irrefutably demonstrated by the record evidence, Hilltop refused to respond to Commerce's follow-up inquiries regarding possible additional undisclosed affiliations. 20

In all three administrative review proceedings, Commerce determined that the circumstances of Hilltop's nondisclosure, outright denial, and ultimate admission to an undisclosed affiliation with Ocean King were such that the agency could no longer rely on Hilltop's prior representations regarding its corporate structure and freedom from government control, the accuracy of which had been certified by the same Mr. To whose credibility was impeached when the record revealed his personal involvement with Ocean King despitehaving repeatedly sworn the contrary to Commerce.21 Having...

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